CAIRO - 24 January 2023: The Sovereign Fund of Egypt (“TSFE”), represented by its healthcare and pharmaceutical industries Subfund (“TSFE Healthcare & Pharma Subfund”), and B Investments Holding S.A.E. (“B Investments”), BPE Partners’ flagship investment vehicle, signed Monday two agreements to invest over LE 2 billion in the sectors of healthcare, and pharmaceuticals distribution in Egypt.
The first agreement provides that the TSFE invests LE 100 million in B Healthcare Investments S.A.E. (“BHI”). BHI was established by B Investments as its designated investment vehicle to invest in the Egyptian specialized healthcare sector with an initial focus on fertility, mother-and-child, and related services businesses. Currently, BHI owns 51% of the Egyptian IVF Center, the pioneer of in-vitro fertilization (“IVF”) and one of the leading fertility centers in Egypt and the MENA region. BHI is targeting to raise up to LE 1 billion of which B Investments and TSFE have committed to invest LE 200 million and LE 100 million, respectively, with the rest to be offered to local and regional private sector investors.
Through the second agreement, B Investments will invest in TSFE Healthcare & Pharma Subfund’s established investment platform dedicated to investing in pharmaceuticals distribution and trade services. The platform aims at enhancing efficiencies and injecting capital to support infrastructure upgrades required to institutionalize the sector. The platform will be partnering with local champions in the market to accelerate their growth into under-served cities in Egypt and across the region. It will also aim at leveraging the latest technological solutions to provide a wide range of digital offerings that will lead to cost efficiencies, ensure market stability, and improve customer experience. A total of LE 1.2 billion will be deployed in the first phase with aspirations to grow even further as more investment opportunities arise.
“TSFE prioritizes the development of the healthcare sector as a prerequisite to achieving sustainable and inclusive economic growth, in line with Egypt’s Vision 2030 goals, as well as the Sustainable Development Goals (SDGs)” said H.E. Dr. Hala H. ElSaid, Egypt’s Minister of Planning and Economic Development and Chairperson of TSFE. “These two investments contribute to providing Egyptian citizens with improved services and are a step forward towards institutionalizing the sector. In addition, TSFE’s investment model is also realized whereby its mandate of partnering with private investors and developing key strategic sectors while achieving sustainable financial returns for future generations, is fulfilled”.
“The ministry adopts a strategic approach to create partnerships with both domestic and international private sector companies in the fields of healthcare and pharmaceutical industries, enabling it to gradually transition from being a medical service provider to a regulator in order to provide better health care services to patients. We highly value our relation with The Sovereign Fund of Egypt and BPE,’’ H.E. Dr. Khaled Abdel Ghaffar, Minister of Health and Population said.
“We are honored to partner up with TSFE to invest in the Egyptian specialized healthcare space” stated Mr. Hazem Barakat, Co-founder and Chairman of B Investments. “We recognize the significant value that TSFE brings to BHI and are looking forward to support and grow local healthcare players. “
“This partnership marks TSFE’s first investment into the healthcare and pharmaceutical services industries. We are glad to partner with BPE Partners who possess the required investment management expertise to realize our shared vision of providing affordable, high quality healthcare services across all regions in Egypt. Together, we will capitalize on the sector’s potential for growth with a larger geographical reach and technology enablement” said Mr. Ayman Soliman, CEO of The Sovereign Fund of Egypt. “TSFE’s trade pharma platform is an integral pillar in the subfund’s strategy. Egypt’s pharmaceutical industry is currently worth over LE 130 billion and our aim is to provide investment solutions to enhance governance, achieve cost efficiencies and ensure market stability to unlock the sector’s full potential” he added.
“We are excited to invest alongside TSFE in this strategic sector of the Egyptian economy” added Mr. Mostafa El-Anwar, CEO of BPE Partners. “We intend to leverage our collective investment management expertise to institutionalize local healthcare businesses, expand healthcare services to the wider demographic of Egypt, and implement high ESG standards to support the competitiveness of the Egyptian healthcare market.”
Both transactions are subject to customary regulatory approvals and are expected to close during the first half of 2023.
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